Wedding insurance can protect your big day from the unexpected — here's what you need to know

If you're planning your wedding, you've likely put a tremendous amount of time and money into making sure it will go smoothly. 

But no matter how carefully you've prepared, your big day could easily get derailed by unanticipated problems like a vendor going out of business or even a natural disaster. This not only puts a damper on your wedding but can also mean you've wasted a considerable sum of money. 

That's where wedding insurance, also called special event insurance, could help. From a damaged wedding cake to a severe weather event requiring postponement, a wedding insurance policy could be a useful tool to make sure the day is made right. 

Here's what you need to know about this wedding insurance, including what it is, what a typical policy covers, and how much it could cost. 

Wedding insurance is an event insurance policy that can cover unexpected circumstances during your wedding events. 

Even when every detail of your wedding has been finalized, it's still possible that things don't go as you planned. "You have a lot of concurrent vendors coming together for an event," Todd Shasha, Assistant Vice President of Personal Insurance at Travelers, told CNBC Select. "You have a venue for a wedding that you're putting down a deposit on, potentially multiple thousands of dollars. If that venue goes out of business, or if there's a disruption due to a storm, there are certainly exposures for those funds." 

A venue is just one of many expenses associated with a wedding. "You might have a photographer or a videographer, you might have a band, you have a dressmaker, a florist, a wedding planner. All of those vendors that are associated with the event potentially present risk," Shasha says. "Let's say they don't show up or go out of business. You can hedge your investment with special event insurance, AKA wedding insurance." 

And if you need help financing all of these wedding costs in the first place, taking out a personal loan can be a good option, provided you're able to pay it back on time without compromising your other financial goals. Some of CNBC Select's favorite lenders include LightStream, which doesn't charge any origination or early repayment fees, and SoFi, which allows you to choose between a fixed or variable interest rate. 

There are two different types of policies to consider when looking at wedding insurance — cancellation and postponement insurance, and liability insurance. Both types of policies cover different things. 

• Wedding liability insurance can reimburse you for any costs associated with injuries or property damage during the event for which you're found liable. Some venues require this type of insurance for couples. 
• Wedding cancellation or postponement insurance can reimburse the cost of canceling or rescheduling your wedding due to outside circumstances like severe weather, illness or injury. 

It's worth noting that wedding insurance doesn't cover every circumstance that could disrupt or cancel your ceremony. Most notably, most policies won't reimburse you if you cancel the wedding just because you no longer want to go through with it. 

Wedding liability insurance generally costs between $100 and $175, according to Elisabeth Kramer, a wedding coordinator and consultant based in Portland, Oregon. "In the scheme of wedding planning, where the average wedding costs $30,000, this is kind of a drop in the ocean, for better or worse," she says. 

This type of insurance generally tends to vary in price by the amount of coverage needed and the size of the wedding, according to Shasha. Many of Kramer's clients opt for $1 million of liability coverage. 

Other add-ons are available for wedding insurance, including liquor liability insurance. You might consider this option if your celebration includes alcohol, as it can protect you from expensive alcohol-related injuries or damage. 

Whether it's a requirement of your venue or you just want some peace of mind about some of your expenses, wedding insurance can play an important role in financially protecting your ceremony. 

Kramer says venues requiring wedding liability insurance are becoming more common in the Pacific Northwest where she works. "Somewhere in the neighborhood of 75%, maybe 85%, of my clients take that type of insurance out," she says. "And that's not because they are seeking to cover their bases, it's because they're contractually obligated at the venue or venues that are hosting their wedding." 

If you're planning on hosting your wedding at home, a review of your homeowner's insurance policy could be helpful. And if you're looking for a policy now, start with some of the companies CNBC Select has ranked as the best around. Nationwide, for example, often offers discounts when you bundle different policies together and Lemonade excels at quickly approving claims. 

Couples can buy wedding insurance either on their own online or through an agent they already work with. "If they carry auto or home insurance, they can contact their agent and ask specifically for this," Kramer says. "Sometimes there can be a cost savings there." 

As with any insurance coverage, you'll want to shop around and look for the highest coverage limits within your budget. 

It's also worth reading the policy of any coverage you're considering carefully. "I would really want to read thoroughly on how I am covered with vendor contracts," Kramer says. "You're contracting with sometimes between 10 to 15 different individual businesses. I would just read the policy and be clear on what type of money I am getting back." 

Wedding insurance could help reimburse you for unforeseen expenses on what may be one of the biggest days of your life. Depending on your policy and any extra coverage you choose, wedding insurance could help protect your finances if a disruption occurs.

Catch up on CNBC Select's in-depth coverage of credit cards, banking and money, and follow us on TikTok, Facebook, Instagram and Twitter to stay up to date